CORE DP 2025 / 16

Informal and formal care for disabled elderly individuals. Substitutes or complements? / Sergio Perelman, Pierre Pestieau

 > The relationship between informal and formal care for disabled elderly individuals -whether they function as substitutes or complements- represents a fundamental question for optimizing public resource allocation in aging societies. We develop a theoretical framework demonstrating that long-term care (LTC) policy design hinges critically on this relationship. Using data from the Survey of Health, Ageing and Retirement in Europe (SHARE), we provide empirical evidence to address this pivotal question.